economy

This is a guest post by Cameron Fenton, Canadian Tar Sands Organizer with 350.org.

This week, the cover of the Economist proclaimed “the fall in the price of oil and gas provides a once-in-a-generation opportunity to fix bad energy policies.” The article teased on the cover explains how low oil prices create the space for governments to make rapid leaps to change energy policy instead of “tinkering at the edges” urging policy makers to use this moment to “inject some coherence into the world's energy policies.”

The article gets a lot of things right. Eliminating fossil fuel subsidies and forcing big polluters to pay for the mess they're making are crucial policy steps, but the piece also presents some more dubious proposals. The last paragraph of the Economist piece is the perfect example of the inherent dangers ahead.

Steven Guilbeault is co-founder and president of Equiterre, a Quebec-based social and environmental solutions non-profit supporting communities opposed to the expansion of the oilsands and construction of the Energy East pipeline.

According to Ms. Brochu and contrary to what TransCanada is trying to sell us, the Energy East project, far from being beneficial to Quebec, will have serious economic impacts on top of its enviornmental effects.

Why? Mainly because TransCanada would have to convert one of its lines carrying natural gas from the west to begin transporting oil from the oilsands. TransCanada has propositioned natural gas distributors in Quebec and Ontario to build them a new gas line, but that would cost $2.2 billion in addition to a reduction in the gas transport capacity from western Canada.

This is a guest post by Mark Jaccard, professor of sustainable energy at Simon Fraser University.

In 2007, Prime Minister Stephen Harper’s government asked me and four other economists if we agreed with its study showing huge costs for Canada to meet its Kyoto commitment to reduce greenhouse gas emissions by 2010. We all publicly agreed, much to the chagrin of the Liberals, NDP and Greens, who argued that Kyoto was still achievable without crashing the economy. It wasn’t.

As economists, we knew that the Liberal government of Jean Chrétien should have implemented effective policies right after signing Kyoto in 1997. It takes at least a decade to significantly reduce emissions via energy efficiency, switching to renewables, and perhaps capturing carbon dioxide from coal plants and oilsands. Each year of delay jacks up costs.

Mr. Harper’s government knew this too. Years later, when environment minister Peter Kent formally withdrew Canada from Kyoto, he charged the previous Liberal government with “incompetence” for not enacting necessary policies in time to meet their target.

The average Canadian doesn’t place the economy above other concerns like education, health care and environment according to a a public-opinion survey analysis performed by the Privy Council Office (PCO), a group of the Prime Minister’s top advisors, in January.

As the Canadian Press reports, the research suggests major federal government policies don’t line up with Canadian priorities.

The analysis followed public opinion research of 3,000 survey respondents and 12 focus groups, conducted by NRG Research Group, on behalf of the Finance Department. The PCO is not obligated to routinely make its research public.

The research showed Canadians have “little enthusiasm” for the Enbridge Northern Gateway pipeline, “even among supporters,” the January 25 PCO report on the findings states. Since then the pipeline was federally approved.

The recent shelving of the Joslyn mine oilsands project in Alberta is a reminder of the fragile economics of the oilsands. No economic formula could be found to make the $11 billion project work and it has been put on hold indefinitely.

Oil major Total E&P, the biggest partner in the project, said the Joslyn mine project “cannot be (financially) sustainable in the long term.” Interestingly, Total did not blame lack of new pipelines for squeezing profit margins either.

It would be difficult to deny Canada has economically benefited from developing the oilsands, a particularly difficult and expensive fossil fuel to mine and refine into light fuels — but failing to diversify the Canadian economy beyond an oil and gas ‘energy superpower’ makes for a very uncertain economic future for Canada.

A new poll released Friday shows the majority of Canadians assume development in the Alberta oilsands has a much larger impact on nation’s economy than it actually does.

According to the poll, conducted by Environics and commissioned by Environmental Defence, 41 per cent of Canadians believe the importance of the oilsands to the economy is six to 24 times higher than it actually is. And a full 57 per cent of Canadians overestimate the value of oilsands to the country’s economy.

The oilsands, according to Statistics Canada, account for only 2 per cent of the national GDP.

Despite the misconception, however, 66 per cent of Canadians still support a transition to a cleaner economy that would limit dependence on the oilsands.

In addition, 76 per cent of Canadians believe that, in light of climate change, the country should shift from fossil fuels to cleaner energy.

Stern, a professor at the Grantham Institute at the London School of Economics, and his co-author Simon Dietz found that the current economic models used to calculate the cost of climate change are vastly inadequate and need to be updated so that proper decisions can be made about risks associated with global warming.

They said that even the Fifth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC) has cited the existing economic models and, as a result, has arrived at severely limited assumptions about the costs of global warming.

“It is extremely important to understand the severe limitations of standard economic models, such as those cited in the IPCC report, which have made assumptions that simply do not reflect current knowledge about climate change and its potential impacts on the economy,” Stern, a former chief economist with the World Bank, said in a media release.

This is a guest post by award-winning environmental campaigner and author Tzeporah Berman. It was originally published in The Globe and Mail and is republished here with permission.

I have family who work in the oilsands. They know that I have been a vocal critic of current oilsands operations and plans for expansion, yet they didn’t hesitate to welcome me last week into their homes and to invite me to a family gathering in Canmore. We had a wonderful time. We shared some memories, laughed a lot and even tackled some hard stuff. The conversations were rich and surprisingly easy. Perhaps in part because although we have different opinions there already was a basis of trust and shared experiences.

The weekend sits in stark contrast for me to the ugly polarizing and simplistic debate about oilsands and pipelines our country is embroiled in. It was also an important reminder for me of a simple lesson I learned during the war in the woods in the ’90’s – that there are good people everywhere and sometimes the people you need the most to figure out intransigent problems are the folks on the so-called other side of the fence. I left thinking about how important it is for us to overcome the ‘taking sides’ attitude over oilsands, pipelines and climate change that has taken root in our country and find ways to create real conversations about solutions to some of the greatest challenges of our age.

Canadian Prime Minister Stephen Harper and Australian Prime Mininster Tony Abbott took turns Monday criticizing efforts by governments to make polluters pay for greenhouse gas emissions.

Abbott, who is visiting North America, and Harper, both said their respective governments weren’t trying to avoid dealing with the problem, but suggested they were trying to avoid damaging the economy.

The comments were immediately challenged by one of the Harper government’s former political advisers, David McLaughlin, who headed a panel that warned Canada would pay an economic price by not taking action to address climate change.

McLaughlin wrote on his Twitter account that the message from Harper and Abbott was reinforcing a “meme” that dealing with the environment, comes at the expense of the economy.

As scientific studies continue to reveal how carbon emissions are making the world’s oceans more acidic, one prominent academic from British Columbia suggests that the rapidly changing marine chemistry could also eventually negatively affect the economies of some coastal communities. If the recent collapse of a scallop fishery off the coast of B.C.’s Vancouver Island is any indication, those negative changes may already be well underway.

Karen Kohfeld, a Simon Fraser University associate professor and a Canada Research Chair in Climate, Resource, and Global Change, said scientists have learned much about the oceans’ chemical makeup in the past three decades but are less certain about how the increased acid levels will affect ecosystems.

“There may be some species that adapt better than others,” Kohfeld told DeSmog Canada on Thursday. “And in the end, we are just beginning to understand how ocean acidification could impact our coastal fisheries in the long run.”